I’ve had a few questions about the candle stat I’ve been looking at and answered those on twitter yesterday. Only two of the reversals made a lower low at the hit of the lower band and all went on soon to make new highs. This isn’t a particularly bearish stat on the bigger picture, it is just striking that all three of the past instances of these candles going back to 1993 all then hit the daily upper band on SPY in 5 to 7 days after this rare candlestick, and then plunged to the lower band in the two to three days after that. Will that repeat again here? Who can say? I’ll be watching to see whether it does with interest though, and if it does, it should set up a decent buying opportunity there. (more…)
Slope of Hope Blog Posts
Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.
Lower High Coming?
SPX retested the daily middle band on Friday and that held well. Now we get to the interesting part of the candle statistics that I was looking at on Friday morning, albeit with a sample size of only three similar candles over the last twenty three years. After the next day all three then moved to touch the daily upper band on SPY. One of those made a full touch and marginal higher high on SPX, and the other two touched the upper band on SPY but fell short of the touch on SPX while making lower highs. What was the really interesting part though, is that after each tested the daily upper band intraday, all three then fell hard to test the daily lower band on SPY within three days. It will be very interesting to see whether that is repeated here. (more…)
Testing the Daily Middle Band
Bears put a strong day together yesterday and broke down below the 50 hour MA. Shortly before the low I tweeted a confluence of strong support levels in the 1957-60 range, and the low was at 1959.46. The key support level here is the SPX daily middle band at 1957, and only a closing break below that would open up lower targets at the daily lower band in the 1930 area and the 50 DMA at 1921. The last two significant lows were at 1945 and 1926 and both of those are potential H&S necklines of course. SPX daily chart:
Revised Upside Targets
Now that primary channel resistance has been broken. I’ve been considering the upside targets that are now in range as a result of that break. The first one is rising channel resistance from the 1814 low, and I have that currently in the 1995-2000 area. That looks like the obvious next candidate for a short term high area as I can’t see any reason here to think that the current high might hold more than a couple of days. (more…)
Two Main Options Today
SPX tested the daily middle bollinger band yesterday and as with Wednesday, there was then a sustained rally to a lower high (so far). The SPX daily middle band is obviously a significant support level, but there should be more downside coming if the bears can put a whole day together. SPX daily chart:
